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Education Realty's Merger with Greystar Nears Conclusion

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The merger deal of collegiate housing real estate investment trust (“REIT”) Education Realty Trust , also known as EdR, with GSHGIF REIT, an affiliate of Greystar Real Estate Partners, LLC, is nearing conclusion, with stockholders of the former approving the agreement.

Notably, nearly 99.90% of the votes casted at the special meeting were in favor of the merger agreement, dated Jun 25, 2018. Also, this represented around 83.95% of EdR’s total outstanding shares of common stock as of the day of the special meeting, dated Aug 10, 2018.

Now the transaction remains subject to some closing norms and is expected to close on Sep 20, 2018. Upon completion of the deal, each share of EdR common stock and each unit in Education Realty Operating Partnership, LP and University Towers Operating Partnership, LP will be converted into the right to receive cash of $41.50 per share or unit, as applicable.

According to the previously-published press release from EdR, Greystar partnered with the real-estate unit of Blackstone, to buy a portfolio of EdR’s off-campus student housing assets situated adjacent to best-in-class university campuses. The real-estate unit of Blackstone was said to acquire a portfolio of income-generating properties, worth $10 billion, concentrated in the U.S markets offering decent growth opportunities. 

Notably, the $4.6-billion alliance will enable the company to maximize shareholders’ value by providing an impressive premium over its share price. In fact, since the change in the company’s management, effective Jan 1, 2010, EdR stockholders have enjoyed total return of 293%. Additionally, based on the company’s outstanding shares as of May 1, 2018, the transaction had an equity value of $3.15 billion.

Shares of this Zacks Rank #3 (Hold) company have outperformed the industry it belongs to, over the past six months. Its shares have gained 28.3%, while the industry has recorded growth of 11.3% during this time frame.


 

Key Picks

Better-ranked stocks from the REIT space include VICI Properties (VICI - Free Report) , Park Hotels and Resorts, Inc. (PK - Free Report) and W.P. Carey Inc. (WPC - Free Report) . All three stocks carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

VICI Properties’ Zacks Consensus Estimate for 2018 FFO per share has been revised upward by a cent to $1.50 over the past 60 days. Its shares have gained 10.6% in the past six months.

Park Hotels and Resorts’ FFO per share estimates for 2018 witnessed 2% upward revision to $2.93 in two months’ time. Its shares have appreciated 24.4% over the past six months.

W.P.Carry’s FFO per share estimates for the current year moved up marginally in the past 30 days to $5.14. The stock has rallied 5.5% in six months’ time.

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